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Calculation details
Planning estimate only. Platform fees, taxes, payment costs, and policies can change; verify current terms before pricing.
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What does this calculator estimate?
Charge your required hourly rate: (income goal + expenses + tax reserve) ÷ billable hours. That is your sustainable floor. If you need $80,000 after expenses and expect only 1,000 billable hours, your rate must sit far above any salary-equivalent wage. Run the exact number free with BoringToolsKit's freelance-hourly-rate-calculator, no signup required.
Why does dividing last year's salary by 2080 underprice me?
A salary hides costs a freelance rate must carry: self-employment tax, unpaid sick days and vacations, health insurance, equipment, software, and the 20-30% of hours that go unbilled to admin and sales. The employeed equivalent of a $60/hour salary is often a $90-110/hour freelance rate. The calculator works from billable hours precisely so those hidden burdens land in the number.
How much cushion should the rate include for dry months?
Freelance income lumps unevenly, so the rate must fund the gaps it creates. A practical test: if your annual expenses divided by realistic billable hours equals your current rate, you have built no cushion. Adding 10-20% for slow months, or pricing per project instead of per hour, converts feast-and-famine into a steadier baseline without changing the work.
How this calculator works
Formula
Minimum rate = (target income + business expenses) / (1 - tax rate) / billable hours.
Worked example
$75,000 target income plus $12,000 expenses at a 25% tax rate and 966 billable hours (35 hrs x 46 weeks): $112,000 revenue needed, a $115.94 minimum rate, price at $120/hour.
Assumptions to verify
- Billable hours are usually lower than total working hours because admin, sales, and learning time are unpaid.
- Taxes, insurance, software, hardware, sick time, and retirement savings should be included.
- Market rates and client value still matter after calculating your floor.
Frequently asked questions
Why is my freelance rate higher than my old salary hourly rate?
Freelancers must cover unpaid time, benefits, taxes, overhead, and business risk.
Should I charge hourly or project-based?
Use hourly as a floor, then consider project pricing when value and scope are clear.
What tools pair with this?
Use invoice, quote, payment-fee, and profit-margin tools to check the full workflow.
Cite this tool
BoringToolsKit. “Freelance Hourly Rate Calculator.” boringtoolskit.com/freelance-hourly-rate-calculator/ (reviewed August 2026). Free to reference in articles, syllabi, and answer posts with a link.
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